Retailers often struggle with overstocked shelves one moment and empty ones the next, despite having more data than ever. So, what’s the missing piece?
In this episode of High on Data, Sunder Balakrishnan, Practice Head of Supply Chain at LatentView Analytics, and Sanjay Singh, CFO at Wellness Pet Company discuss what’s holding retailers back from achieving optimal inventory management.
They also share a real-world example of how better inventory visibility led to a 5x increase in both sales and stock value for an apparel retailer.
Listen to the full episode - https://lnkd.in/gMDijzk9
One thing that I find very common. Both at CBG and at retail is around inventory visibility, or rather the lack of inventory visibility. And it really puzzles me because more data and more connected data is now available and yet inventory visibility is a challenge. So I mean, if you think about it. Um, let's talk retail and within retail, let's talk a case in part apparel retail. Lead times in apparel retail could be as much as 18 to 24 months. I mean, imagine the kind of inflexibility that that entails, right? There is no room to react to fashion changes and trends. You know, a fashion retailer that I worked with was really struggling with demand because their lead times were like 2 years or, you know, 1 1/2 or two years. And they had no capability to read trends and react. So they went to school to study fast fashion where lead times are dramatically lower. Could be 3 to 6 to 9 months. And that's the norm in fast fashion. But now not everybody wants to become fast fashion because that's not their business model. But they're able to learn how do you reduce lead times? And they, this company that, that I, that I worked with was able to reduce their lead times dramatically down from 24 months to 12 months. And that first for most items that needed it, like fashion items, for example. And that was transformational. So they are now. Able to dedicate about 20 to 25% of their entire open to, to chase, to read and react to trends and, and imagine what a powerful impact that is. They talk about it in their earnings calls. Their sales are up double digits, their inventories lower and cleaner, and the stock is up 5X. Now you know that a multiple capabilities needed that that need to be in place, not just chase and and lead time reduction. But that's just one example of how. You know the the critical difference was gaining visibility into their vendors inventory and sometimes in the vendors vendors inventory.
Director Operations
1wHelpful insight